To Grow Your Small Business You Must Think Big
Newsletter: February 2011 To Grow Your Small Business You Must Think Big There is a lot of attention directed at small businesses this year. President Obama talked about the need to help and support small businesses in his State of the Union address. States are talking about easing regulations and the tax burden on small businesses in their quest to reduce unemployment. Is this the year of the small business? Possibly. Is this an opportunity for you as a small business owner? Maybe.
As a small business owner, however, it is not a good strategy to hope that the federal or state governments will pass the right legislation and write regulations that will help you succeed in the next 12 months. Hope may spring eternal, but it is not a good business strategy.
Be wary of generalizations about how the economy is doing: who the winners are and who the losers are or will be. It's distracting and frankly, it's filled with conflicting information. It's like trying to decide on what is the best way to add 10 years to your life. You would be correct if you said - it depends on whom you ask. A dietician will tell you to focus on good nutrition. A trainer will tell you to exercise and use protein supplements. Some physicians would say hormone therapy. As the adage goes: when all you have is a hammer the whole world looks like a nail.
The economy is showing signs of recovery, but the real question is whether it's showing signs of recovery for you and your business. To answer this question you need to stop thinking like a small business owner and start thinking that you are running a multi-million dollar enterprise. Why, because many small business owners tend to think small. And the answer to growth is to think big.
Here are seven questions for you to think about and respond appropriately to:
- Do you have a strategic vision that outlines your business direction for the next 12 - 24 months? And if you have employees, do they know it?
- What is your stated vision and mission or purpose statement? And how are they communicated to your employees, and how do they help drive business decisions?
- Do you have stated, written and practiced company values to align how you and your employees work together and serve your customers?
- Do you have a branding strategy that promotes how you want to be seen by prospects and clients and articulates your competitive advantage or differentiation from your competitors?
- Do you have standard monthly financial reports to track the financial health of your business and to help drive your decisions?
- Do you have outstanding customer service? If you can't answer based on your customer's feedback, loyalty, references and testimonials - your answer is, not yet.
- Do you have an exit strategy for your business? Every business needs to have a sense of what the end game will look like. It drives growth and helps focus business decisions.
We know and work with many companies that have good answers for each of these questions. They've not only thought about them but they keep refreshing their answers yearly. Unfortunately we have seen companies that believe answering questions such as these is a waste of time..
A small research oriented company who had been in business for 10 years was modestly successful. They were concerned, however, that although they were able to come up with a strategic plan, which they did every year, they were not disciplined enough to implement the tactics required to achieve the plan. And they really didn't have to. Business came in and they were comfortable. You have likely heard us reference that success can be your greatest inhibitor to growth. And, the issue for them was that they weren't growing.
They decided to re-focus their efforts on growth. To do that they:
- Established company values to guide their work together and in serving their clients
- Created their strategic vision (ideal future state)
- Refined their purpose (or mission) statement
- Identified key strategies and tactics to implement the vision and created accountability by assigning those to lead individuals. Progress on tactics was reviewed quarterly, with general updates given monthly.
- Candidly discussed how they worked together and how work should be distributed to take advantage of each partner's strengths
- Identified their target market and the market niche
- Created tracking and reporting tools and a process to monitor sales
- Created a financial reporting system, reviewing it monthly and using ratio analysis to do a year over year comparison
- They are embarking on a re-branding strategy
- They are working to identify and develop an exit strategy
So what really happened? Were they lucky? Were they in the right place at the right time? No - neither of these can explain their growth. What they did was stop thinking small. They stopped behaving like a "mom and pop shop" and decided to focus on growth.
So, we encourage you to take a dispassionate view of your business. Stop listening to the generalities and honestly and thoughtfully respond to your own market-focused questions we suggested. Thinking small will keep you small; thinking big and planning big will lay the path to your growth.
Healthcare Corner In this month's healthcare corner we address the issue of Medicaid. It's a program we are hearing more about because of the financial impact it has on state budgets. We believe it's important to know the facts and understand its implications to businesses in your state. As the Medicaid roles increase due to unemployment, state funds decrease resulting in cost reduction initiatives and tax increase discussions.
The Kaiser Commission on Medicaid and the Uninsured Report:
- Medicaid is the nation's primary health insurance program for low-income and high-need Americans
- Medicaid is the largest source of funding for safety-net providers and the dominant payer for long-term care. Medicaid also helps to make Medicare work for low-income elderly and disabled beneficiaries
- State and Federal government jointly administer and finance the Medicaid program
- Medicaid increases access to care and limits out-of-pocket burdens for low-income people
- Most Medicaid enrollees access care through managed care plans that use private provider networks to deliver services
- Medicaid accounts for about one-sixth of total health care spending in the country
- The elderly and disabled account for the majority of Medicaid spending
- Medicaid spending is concentrated among a small number of high need enrollees
- Enrollment is the dominant driver in Medicaid spending, especially during times of economic downturn
- States have a strong incentive to manage Medicaid cost growth
- On a per enrollee basis, Medicaid spending is growing more slowly than premiums for employer-sponsored insurance or national health care spending overall
- Medicare is the largest source of federal revenue for states. Medicare funds support health care providers, jobs and state economies overall
- Enhanced Medicaid matching funds in ARRA (American Recovery & Reinvestment Act) have been critical in helping support state budgets and Medicaid during the Great Recession
- Medicaid is the third largest domestic program in the federal budget (behind Social Security and Medicare - and the three combined account for about 43% of federal spending Medicaid - 8%, Medicare - 15%, and Social Security - 20%)
- Some deficit reduction programs would fundamentally change the structure and financing of Medicaid
- Health reform builds on Medicaid as a base of coverage for low-income Americans
- The federal government will finance about 95% of the costs of new Medicaid coverage over the 2014 to 2019 period. States could experience savings from reduced payments for uncompensated care and other services (like mental health services) currently provided for the uninsured
- Like today, health reform has Medicaid enrollees accessing care through managed care plans
- ACA (Affordable Care Act) provides new options to expand community-based long-term care and to coordinate care for high cost populations
Announcements Kubica and LaForest are speaking at the IFMA's Fusion Conference in Boston on March 23, 2011. Their talk is on - Results Trump Time: Accelerated Practices for Today's Leaders in Time, Focus and Influence Management. They address why time management principles alone will not relieve your time pressures. And they introduce the concepts of influence and energy leadership as two critical factors for better managing your time and creating positive results.
Kubica LaForest Consulting is a Management Consulting, Executive Coaching and Business Performance Improvement company. Tony Kubica and Sara LaForest have 60+ years of combined experience in helping individuals and their businesses and organizations improve their performance and accelerate their business growth in record time. We specialize in business and the psychology of business. For more information on us, visit our website: www.kubicalaforestconsulting.com.
Key Reasons Why Clients Come To Us:
- Candidate Suitability (Selection and Promotion)
- Transition Management:
- They are not quite ready for their new role as a new executive or manager (whether hired externally or promoted from within)
- They are not ready (able) to leave their current role (to advance or retire) as there is no one behind to fill their shoes: No succession plan and leadership pipeline.
- They are not familiar with going it alone: When transitioning from an organizational background (i.e. senior executive out on their own / as an entrepreneur)
- They are interested in making their business partnership more effective. We help build transformative partnerships.
- They need interim management / IT staffing support during the transition.
- Business Growth: They are in or working to be in a business growth mode.
- Underperformance or Inefficiency: They are not as effective as they would like to be (or should be) in their role.
- Life Balance: They are unhappily successful, meaning they are killing themselves through overworking, overdoing and over-responsibility.
Warwick, Rhode Island 02818
blog.growthwithoutsabotage.com We offer organizational and performance improvement services that result in:
- Transition Management & Succession Planning
- Leadership Strategy & Development
- Business Growth & Performance Improvement
- Improving Client & Business Relationships
- Brand Building & Impression Management
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